“Our carefully crafted acquisition strategy is simply to wait for the phone to ring. Happily, it sometimes does so, usually because one of our clients who sold to us earlier has recommended us to a friend.” Warren E. Buffett in his letter to the shareholders of Berkshire Hathaway Inc.

But in such slow stagnated market, could we rely on our acquisition strategy, what we commonly follow?

Unfortunately, pressure of work, stress running to maintain our cash flow scientifically or prospectively, lack of time, the insufficient luxury of patience,  and too little or too much scattered information are common reasons to undermine the importance of strategic thinking.

In the efforts to continue highlighting the importance of building a laser focused strategy and after the high circulation of the previous article describing how building a laser focused strategy defined Nespresso today’s position in the market, we thought of sharing another case study that shaped Sony in its early days.

Strategies that succeed are organic. They evolve. They wrap themselves around problems, challenges and opportunities, make progress and move on.

Sony Case Study

The Sony story began in the 1950s when Akio Morita and Masaru Ibuka were introduced to the tape recorder. Japanese companies did not make them so they decided that tape recorders would be their first product. From the beginning, Sony’s founders were more pioneering than traditional japanese companies, developing their own machine and magnetic tape without outside help. Crucially, they were ambitious and they were willing to be unconventional.

Initially they thought their product would sell itself, but prospective customers said the price was too high. So Morita researched the market and realised that high-value items sell only if the consumer understands their value. As the public was not familiar with its product, Sony had to educate people about it. Morita realised that the fewer links in the chain of communication, the better, so instead of relying on third parties for distribution, which was normal in Japan, Sony set up its own sales outlets.

Japan’s economy was unstable so Sony realised that to offset regional and national business risks it needed to target international markets. Instead of dealing through trading companies, however, it set up its own marketing system.

Sony quickly improved its products’ quality and reliability because defective products exported from Japan were expensive to repair. This also boosted its productivity and cut costs. While western companies were choosing between product differentiation or competing on price, Sony was doing both simultaneously.

With sales rising and its reputation growing, Sony began production outside Japan. in 1970 it opened its first color television factory in the United States in San Diego. Production facilities spread through the United States, Europe, Brazil, and Venezuela and Sony invested heavily in market development, creating a worldwide brand. The growing market share generated further process improvements and lower costs.

To exploit investment in its brand, Sony developed a portfolio of focused categorized products by putting together project teams.

The question that often comes up at times of strategic transformation is: should you pursue a highly focused approach betting everything in one strategic goal, putting all your eggs in one basket; or should you hedge?

Irrespective of the approach followed, I believe there is a one winning strategy. It is to carefully define the target market and direct, designing a sales structure, a superior offering to that market.

* This case study as published by The Economist “Business Strategy 2nd Edition”

How we Could Help

The strategist’s method is very simply to challenge the prevailing assumptions with a single question: “Why?”

With our scientific approach in analyzing your sales problems, challenges and opportunities quantitatively and qualitatively, we come accordingly to aid in putting together the required efforts and attention for building a laser focused sales strategy. The latter would aid in structuring, transforming and optimizing  your sales performance.

Such exercise enable organizations to have a very clear visible picture of their current situation. Our intensive engagements include planning and executing the set plan that link together people, strategy, plans and processes. Such engagements will lead not to only overcome existing sales problems and challenges, but also to optimize their potential and build a platform for continuous improvement.

For case studies that have been drawn  from  Heed’s recent engagements Read More ….

If you are facing any uncertain sales challenges, or interested in optimizing your sales performance feel free to contact us, or directly respond to mfarah@logicshape.com.